1. Education

Your suggestion is on its way!

An email with a link to:


was emailed to:

Thanks for sharing About.com with others!

The Keynes Effect
<Back to Last Page>     <Full Glossary>

Definition of The Keynes Effect: As prices fall, a given nominal amount of money will be a larger real amount. Consequently the interest rate would fall and investment demanded rise. This Keynes effect disappears in the liquidity trap. Contrast the Keynes effect with the Pigou effect.

Another phrasing: The Keynes effect is that a change in interest rates affects expenditure spending more than it affects savings. (Econterms)

Terms related to The Keynes Effect:

About.Com Resources on The Keynes Effect:

Writing a Term Paper? Here are a few starting points for research on The Keynes Effect:

Books on The Keynes Effect:

Journal Articles on The Keynes Effect:

<Return to Main Page>

Related Video
Ben Craine on the fear of the iPod effect
Set Up a Formal Dinner Place Setting
Explore Economics
By Category
    economicsEconomicseducationEducationaf5041839b000706cb80846faf5041839b000806cb806301http://economics.about.comod526F6F7493126liveJodi Beggseconomicsguide38s000NfzNIP11970-01-0110/od/index.htm0526F6F741approved/od
  1. About.com
  2. Education
  3. Economics

©2017 About.com. All rights reserved.